Stocks Slump After Strong ISM Manufacturing Report
Stocks started the trading session in the black on the heels of solid volume on the busiest shopping day of the year. Online sales hit a record over the Thanksgiving Day weekend, and are expected to soar over Cyber Monday. Investors needed to absorb a plethora of economic data that is scheduled to be released this week ISM manufacturing was reported and this will be followed by ADP private payrolls and the government employment report on Friday. Toward the end of the session stocks moved lower, on light volume with all three major averages closing in the red.
Online sales over the Thanksgiving weekend topped 1 billion in sales which is expected to increase over the first couple of days in December. Electronic devises are expected to see the largest year over year increases in sales volume, led by Apple products.
In international news, China reported that its official purchasing manager’s index was unchanged at 51.4 in November over the weekend. Many analysts had expected the released to show a small decline given the HSBC preliminary measure slipped to 50.4 from 50.9. The sub-indexes saw some improvement. Export rose to 50.6 from 50.4, but new orders slipped to 52.3 from 52.5.
The US employment report will be released this Friday but there will be many data points prior that will give investors a clue of the employment situation. On Wednesday ADP will release private employment data which will likely be the driving force behind the government’s report. On Monday, the ISM released manufacturing data that was better than expected. According to the Institute of Supply management, the index of manufacturing printed at 57.3 the highest since April of 2011. The New Orders Index, which reflects a future gauge of activity, increased in November by 3 percentage points to 63.6 percent, and the Production Index increased by 2 percentage points to 62.8 percent.
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